The Cost of Unnecessary Hospital Days for Medicare Joint Replacement Patients Discharging to Skilled Nursing Facilities

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Gertrude Pierce
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1 The Cost of Unnecessary Hospital Days for Medicare Joint Replacement Patients Discharging to Skilled Nursing Facilities Udai S. Sibia MD MBA, Justin J. Turcotte MBA, James H. MacDonald MD, Paul J. King MD Center for Joint Replacement, Anne Arundel Medical Center, Annapolis, Maryland

2 Disclosures No relevant disclosures

3 Medicare Rule The necessity of the 72-Hour Medicare mandate (3-night stay rule) has been the subject of much debate in the orthopaedic literature. Population-based reimbursement models are shifting the burden of cost from Medicare to health systems.

4 Purpose Our study sought to examine the economic impact of the Medicare 3-day rule using discharge data from a national database (NSQIP) National Surgeons Quality Improvement Program database

5 Methods - % SNF discharges National Surgeons Quality Improvement Program (NSQIP) database for 2015 Current Procedure Terminology (CPT) codes (hip) and (knee) Exclusion criteria Younger than 65 years of age Evidence of prior infection (wound class = 2, 3 or 4) Emergent surgery (defined in NSQIP) Inclusion criteria Patients with a 3 day LOS

6 Methods Hospital Costs Institutional Cost Accounting System Reviewed inpatient hospital costs for patients discharging on POD #3 and compared them to patients discharging on POD #2 Sibia US, King PJ, MacDonald JH. Who Is Not a Candidate for a 1-Day Hospital-Based Total Knee Arthroplasty? J Arthroplasty Jan; 32(1): Sibia US, MacDonald JH, King PJ. Predictors of Hospital Length of Stay in an Enhanced Recovery After Surgery Program for Primary Total Hip Arthroplasty. J Arthroplasty /01;31(10):2119. Institutional Accountable Care Organization (ACO) Determine the average charge for SNF per day

7 Results - NSQIP Patients over the age of 65 years Patients discharged on POD #3 Patients discharged to Skilled Nursing Facilities 42,423 TJRs 14,395 THRs 28,028 TKRs 17,274 TJRs 5,252 THRs (36.5%) 12,022 TKRs (42.9%) 7,487 TJRs 2,404 THRs (16.7%) 5,083 TKRs (18.1%)

8 Results Hospital Costs Institutional Cost Accounting Hospital costs for 3-day vs 2-day LOS» $2014 higher for THRs» $1814 higher for TKRs Accountable Care Organization Skilled nursing facility charged $485 per day Net savings» $1529 for THRs» $1329 for TKRs

9 Economic Impact for NSQIP NSQIP (17.6%) 2,404 THRs 5,083 TKRs

10 Economic Impact for NSQIP NSQIP (17.6%) 2,404 THRs 5,083 TKRs Literature 64.4% eligible for discharge on POD #2

11 Economic Impact for NSQIP NSQIP (17.6%) 2,404 THRs 5,083 TKRs Literature 64.4% eligible for discharge on POD #2 Savings $1529 THRs $1329 TKRs

12 Economic Impact for NSQIP NSQIP (17.6%) 2,404 THRs 5,083 TKRs Literature 64.4% eligible for discharge on POD #2 Savings $1529 THRs $1329 TKRs Net Economic Impact $6,717,579 $2,367,161 THRs $4,350,418 TKRs

13 Economic Impact for CMS CMS data (2014) >400,000 TJRs

14 Economic Impact for CMS CMS data (2014) >400,000 TJRs NSQIP 17.6% discharged on POD #3

15 Economic Impact for CMS CMS data (2014) >400,000 TJRs NSQIP 17.6% discharged on POD #3 Literature 64.4% eligible for discharge on POD #2 Savings $1529 THR $1329 TKR

16 Economic Impact for CMS CMS data (2014) >400,000 TJRs NSQIP 17.6% discharged on POD #3 Literature 64.4% eligible for discharge on POD #2 Savings $1529 THR $1329 TKR Net Economic Impact $64 million (projected)

17 Limitations NSQIP does not identify discharge readiness Hospital costs vary significantly by geographic location. Anne Arundel Medical Center costs are lower than national and state averages Literature describes savings of $5236 [5] to $7272 [6]. Based on these findings, we project CMS economic impact of $ million

18 Conclusion In this cost-sensitive healthcare environment, our study calls into question the cost-effectiveness of the Medicare 3-day rule. The overall health system may save substantial money if SNF utilization rates remain the same, but appropriate patients are discharged to inpatient facilities on POD #2.

19 References 1. Lipsitz LA. The 3-Night Hospital Stay and Medicare Coverage for Skilled Nursing Care. JAMA. 2013;310(14): Aaronson WE, Zinn JS, Rosko MD. The success and repeal of the Medicare Catastrophic Coverage Act: a paradoxical lesson for health care reform. J Health Polit Policy Law. 1994;19(4): Sisko ZW, Lu M, Puri L. The 72-Hour Medicare Mandate After Total Joint Arthoplasty: Is this Medically Necessary? J Arthroplasty 2016; 31: Halawi MJ, Vovos TJ, Green CL, Wellman SS, Attarian DE, Bolognesi MP. Current Evidence Does Not Support Medicare's 3-Day Rule in Primary Total Joint Arthroplasty. Am J Orthop /01;44(10):E Hernandez VH, Ong A, Post Z, Orozco F. Does the Medicare 3-Day Rule Increase Length of Stay? J Arthroplasty /01;30(9): Bozic K,Ward L, Vail T, et al. Bundled payments in total joint arthroplasty: Targeting opportunities for quality improvement and cost reduction. Clin Orthop Relat Res 2014;472:188.

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